L Dean Davidson

The good news is that home sales, pending contracts, and closings are on the rise. As I said before we hope this is a light at the end of the tunnel, and I don't mean a freight train. Our Market Center has had two very good months, for both gross commissions earned and profitability.

One of the things I have become aware of is the increased building activity among homebuilders in the Waxhaw, NC and Weddington, NC areas, as well as the areas of Lancaster and York Counties just next door to Charlotte. This is going to be a key factor in getting the economy rolling again, and some relief to the unemployment numbers.

One area that you, if you are a near future buyer, should be investgating is Waxhaw NC. Waxhwaw is located at the south end of Hwy 16, due south of Charlotte. It is 6 miles south of Weddington, at Hwy 84, and just 9 miles south of the I-485 loop. Check you map for reference.

Waxhaw is an old, historic, little railroad communtity with an original landmark footbridge over the rails, in between N. Main and S. Main Streets. There are several antique shops in Waxhaw, and it is becoming home to artist and craftsmen of all sorts, and has several small festivals every year to celebrate its heritage, and put its wares on display. There is even an annual Highland Games, with a gathering of the Clans.

Some of the most attractive land positions in Union County are located around Waxhaw, featuring planned communities with wonderful amenities, and surrounded by the best schools in the State of North Carolina. I know because I live down there, and my wife is an education professional in the Union County School System.

If you are surfing the internet and you come across neighborhoods in Waxhaw, Weddington, Marvin and Wesley Chapel, take pause. You may be home. Communties like Lawson, Millbridge, Edenmoor, Skyecroft, Weddington Chase are those you will want to visit.

All of this quaint, near-country living is within 10 miles of I-485 and 15 miles of some of the most desired shopping venues in the Charlotte and Ballantyne Area. There are also several equestrian and golf communities if those activities have special appeal to your family. And because the area is growing, so are the entertainment venues, like excellent restaurants and food finds of all kinds.

You owe it to yourself to meet this area personally, and I am one of its own.

POSTED BY THE WALL STREET JOURNAL TODAY 10/29/2009

Wall Street Journal 10/29/09

WASHINGTON -- Senate negotiators reached a tentative deal to extend a tax credit for first-time home buyers, but its passage remains uncertain.

The agreement would extend the existing credit for first-time home buyers, worth up to $8,000, while offering a new credit of up to $6,500 for some existing homeowners, Senate aides said. The reduced credit would be available to all home buyers who have been in their current residence for a consecutive five-year period in the past eight years.

The new provisions are aimed at broadening availability of the credit beyond first-time buyers and giving the weakened real-estate market a bigger boost while preventing real-estate investors from benefiting.

Many property experts have cited the credit as a reason for signs of recovery in the housing market in recent months. But that recovery was somewhat undercut by the September drop in new-home sales reported Wednesday.

The credit would be extended from its current expiration date of Dec. 1 to all contracts entered into by April 30, and closed before July 1. It is expected that income limits on people claiming the credit would be increased to $125,000 for singles and $250,000 for couples, from the current $75,000 and $150,000, aides said. The credit phases out for people making more than those amounts.

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I will continue to post updates on this piece of legislation until resolution is achieved or died.

On November 30 the $8,000. Federal Tax Credit for first time homebuyers will expire. This stimulus has helped the real estate and building industries the last several months, as it has allowed markets to reduce some of their inventories, and brought action to buy from many who were sitting on the fence to see what happens with interest rates and prices. The problem was the limited scope of the program.

I've written previously that this stimulus should have been offered to any buyers regardless of of their status, and the price range of the home purchase (as long as it primary residence, or home used by a family member, such as inlaw or dependent in college). This would have relieved much more inventory and at fairer prices to the sellers, allowed people who wish, or need, to relocate to sell their homes, and created a demand once more for new construction, putting many layed off construction and related trade workers back on the payrolls, reducing the growth of unemployment overall.

This still may happen, and that should be good news. There has been legislation introduced in several forms, which extends the current program another 6 monthe to a year, and more importantly, broadens its scope to include the homebuyers who are not first timers, and are looking to move up or move out. If this legislation does not pass, and the current program expires as scheduled, the gains made over the last several months will be eclipsed by growing unemployment, which is already dangerously close to the 10% mark.

If you are reading this post, please be pro-active and contact your Representatives and urge the passing of this legislation. It has more long reaching effect on the nations economy right now than anything else that can be on the table. Our voice, whether raised with pen or phone, is the most powerful tool the average citizen has at their disposal. Let's use it.

I bet most of you are like me and a little conflicted over the mixed messages regarding the home real estate market conditions. I stated not long ago that we are supposed to be in a super buyers market, and that, literally, should be the case. However, it is not really a buyer's market unless buyers are buying.

It is true we have seen an upturn in sales contracts (pendings) and closings the last couple of months. This was to be expected due to the tax incentives passed down by the Fed for "first time homebuyers". These were defined as anyone who has not owned a home in three years or more. They have made up the bulk of the gains the market has made this year.

Smoke and mirrors? Possibly. The tax incentive could have been extended to anyone buying a home in the year 2009, regardless of price point, or residency status. In other words, investors could have been incentivised to buy as well, thereby relieving the market of more of the previously foreclosed properties. With that inventory reduced, more people that were desiring to move up, could have sold there existing homes a lot faster, and made that next purchase possible. This would have really helped the home builders who have had to lay a lot, if not most, of their labor force off.

As I said earlier, indicators say we are bottoming out of this real estate recession. Maybe. My concern is that the stimulus measures are not going to work fast enough to turn the tide of rising unemployment, and this recovery will begin to reverse itself before it really has solidly begun.

Let's hope the administration is not sandbagging these stimulus funds until it can serve them in 2011-12 to assure re-election.

Feel free to email me or post your comments to this site.

Fence sitters may be dealing with an opportunity lost by trying to time the market in hopes of a "better deal". The following demonstrates that which we have been saying for months.

As the pressure for higher mortgage rates has increased in recent weeks, investors have speculated that the Fed would step in to "defend" certain interest rate levels, but that hasn't happened. This week, Fed officials explained that their mortgage-backed securities (MBS) purchases are designed to support the mortgage market and not to set rates. The Fed's MBS purchases of $25.5 billion this week were similar to levels seen in recent weeks. Disappointed that the Fed hasn't increased its quantity of asset purchases, investors sold MBS this week, and mortgage rates moved higher.

A number of factors have been developing which typically push interest rates higher. The coming supply of debt needed to pay for government programs will compete for investor funds. Despite strong demand for this week's large Treasury auctions, investors are concerned that higher rates will be required in the future. In addition, an improved economic outlook has made investors more willing to move funds to riskier assets and away from safer assets such as bonds. It also means that higher inflation may be a concern sooner than previously expected.

Info courtesy of Jeff Cook, Bradford Mortgage Company.

This afternoon investors decided the selloff of MBS was overdone and favorable re-pricing took place.

Rates are still EXCELLENT!

Here's a sample of Primary Home Purchase money rates today, up to 0+1, with escrows for a borrower with median credit of 720-760. These are subject to vary based on loan amount, occupancy, LTV, credit quality and other factors.

Conforming (using 250K as amt)

30 yr fixed 4.875%

15 yr fixed 4.5%

5/1 ARM, 30 yr am 4.00%

Jumbo (using 650K as amt)

30 yr fixed 6.00%

15 yr fixed 5.00%

5/1 ARM, 30yr am 4.375%

Super Jumbo (using 1M amt)

30 yr fixed 6.125%

15 yr fixed 5.00%

5/1 ARM, 30 yr am 4.375%

Complements of Ashleigh Sumlin, Bradford Mortgage Company, 704-307-9908